Research
27 March 2025
Market Pulse - AI-Fueled Growth, Consolidation Momentum & Capital Efficiency in Focus
The February 2025 edition of Market Pulse reveals a market brimming with early-year energy, driven by AI innovation, renewed crypto momentum, and M&A activity heating up across both fintech and business tech sectors.
🚀 Fintech: Strong Signals from Nearly Every Vertical
Wealth & Capital Markets continues to lead as the fastest-growing segment, driven by AI-powered platforms like valuation software (€55M round from Goldman Sachs Growth) and trading intelligence tools (€40M from One Peak).
Banking & Digital Currency saw a resurgence in crypto-related activity, with €927M in funding volume and large deals like a €140M round for embedded finance.
Payments remain ripe for consolidation, including a €2.4B exit in luxury retail payments and a €150–300M acquisition of a direct marketing payment business.
Lending & Mortgages kept momentum in SME finance with a €125M round from Fortress and €66M for invoice-based lending.
Insurance is the outlier this month in terms of funding, but AI-led plays in risk assessment and claims automation are starting to build investor interest.
💼 Business Tech: Automation and AI Take the Stage
Business Process Automation stole the spotlight, attracting €121M for an AI workflow platform and €71M for real estate revenue management tools. It also posted the highest EV/Revenue multiples across the tech verticals.
HR & Payroll added two more HR deals to the mix this month, with recruitment and talent platforms under €50M gaining traction. AI-led learning and hiring solutions are driving renewed interest here.
Regulatory & Legal Tech remains active at seed stage, focused on AI-driven legal assistants and compliance tools.
Tax & Accounting continues to experience consolidation at the micro level across European markets.
📈 Finch Index vs. Broader Markets
The Finch Index continues to outperform traditional benchmarks like the S&P 500 and Nasdaq across growth, revenue multiples, and EBITDA margins—especially in high-growth verticals like WealthTech and Business Process Automation.
From AI-native tools to B2B infrastructure and financial APIs, February’s data confirms one thing: ambitious, capital-efficient scale-ups are setting the tone for 2025.
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